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location. The MNE has a variety of alternative contractual arrangements, ranging from arm's length international trade through the wholly owned foreign subsidiary, and weighs their relative benefits and costs to determine how the enterprise enters the foreign market and expands its operations over time.

The successful MNE simultaneously combines these ownership, location, and internalization advantages to design its network of activities and affiliates in ways that maximize its market shares and growth.
其实大国和小国的区别就是大国对世界经济有影响，而小国没有。没有必要区分大，小公司投资的区别。对于国际投资评价主要表现出以上三个方面即可(ownership, location and internationalization)。如果有问题可再商榷。
Like the other Baltic States, Estonia is experiencing a steep rise in foreign direct investment. For such a small country, one of the key factors in its success is its location.（如果是大国的话，主要是分析投资环境等，如：macroeconomic policies, political institutions, openness and levels of education）

Q5 Balance of payments

The balance of payments is an accounting of a country’s international transactions over a certain time period, typically a calendar quarter or year. It shows the sum of the transactions (purely financial ones, as well as those involving goods or services) between individuals, businesses, and government agencies in that country and those in the rest of the world.

The export of goods and services, the receipt of unilateral transfers, and capital inflows are credits because they all involve the receipts of payments from foreigners. On the other hand, the import of goods and services, unilateral transfers to foreigners, and capital outflows are debits because they involve payments to foreigners.

A device that multinational enterprise (MNEs) utilize in their effort to decrease their overall tax burden is transfer pricing. The price that one subsidiary charges another subsidiary for internal goods transfers is called a transfer price. The setting of transfer prices can be a sensitive internal corporate issue because it helps to determine how total firm profits are allocated across divisions. Using this technique, an MNE reports most of its profits in a low-tax country, even though the profits were earned in a high-tax country. For example, if corporate profit taxes are higher in the parent country than in the host country, and if the parent firm is exporting to its subsidiary in the host country, the MNE can lower its overall tax burden by underpricing its exports to its host-country subsidiary, thus shifting profits from the parent to the subsidiary.

Transfer pricing may also be used for improving the apparent profitability of a subsidiary. This may be done to allow the subsidiary to borrow at more favorable terms, since its credit rating will be upgraded as a result of the increased profitability. Paying the subsidiary artificially high prices for its products in intrafirm transactions can create the higher profits.

The firm that uses transfer pricing to shift profits from one subsidiary to another introduces an additional problem for financial control. It is important that the firm be able to evaluate each subsidiary on the basis of its contribution to corporate income. Any artificial distortion of profits should be accounted for so that corporate resources are efficiently allocated.

Q6 Exchange Rates

The PPP theory helps explain the behavior of a currency’s exchange value. According to this theory, changes in relative national price l本论文由英语论文网提供整理，提供论文代写，英语论文代写，代写论文，代写英语论文，代写留学生论文，代写英文论文，留学生论文代写相关核心关键词搜索。